Open vs. Closed PLM Debates

I read Fortune CNN Money Blog article by Jon Fortt – Chrysler’s Engineering Software Shift. In the competitive world of PLM software it raises again the question about what is the better choice – Open or Closed? The context of this article is leaked information about Chrysler’s movement from CATIA to NX or, maybe more from DS PLM product lines to Siemens PLM. However, author made a nice association between the engineering software story and bigger story related to the strategy of closed platforms such as Apple, Oracle and Cisco. It made me think how I see the future of Open vs. Closed routes in PLM.

CAD Openness
The debates about openness of CAD and later PDM/PLM software is not a big news in the industry. From the early beginning, CAD applications tried to protect themselves, by creating a proprietary format to store geometrical models and drawings. For the long period of time and until now, practically all leading CAD vendors are using closed file formats. It created a separate industry of companies working on translators and supporting so called “interoperability”. The discussion about CAD openness and interoperability is probably the longest one I can remember in the history. I’m not sure we’ll be able to see the end of this story. The current situation reflects clearly the conflict of vendor’s business models and user interests. CAD industry veterans outline the future of CAD (MCAD) will remove this barrier and make CAD product more open. You can take a look on my blog post – CAD Future: How To Liberate Data.

PDM/PLM and CAD Integration
In the beginning, PDM was about just managing meta data about CAD File. It started from revision management and release control. Most of PDM system in the market managed to have multi-CAD integration strategy by supporting multiple vendors. However, customers were interested in more integrated products. Evolution of PDM product into PLM, including their ability to manage a diverse set of product data and processes, just added more fuel into development of future PLM Platform strategies. It was a time, when vendors started to think seriously about how to create completely integrated product suites. Dassault V6 is a first kind of system that introducing CAD/PLM system bundle.

CAD vs. PLM Openness
What is the difference between CAD and PLM Openness? In my view, it is an interesting turning point in the overall story of engineering software. In the real world, customers are working with a diverse set of tools. In the world of pure CAD, their decision to work with multiple CAD products was hard, but doable. Many of the customers (especially big ones) worked historically with multiple CAD products. PLM is adding new flavors in the old story about CAD openness and interoperability. This is the place where the world of CAD files ends and companies are starting to think more about how to manage all engineering and enterprise data assets.

The Future Is Open?
The most important question is how we can move into the future where data will be more open. I think, many of the companies, are thinking how to solve this problem. It looks like a very promising future to make data open. However, the business reality is different and companies are continuing to make profits from closed platforms. The following quote from Fortune article is the most important, in my view:

When the closed strategy works, it can yield outsize profits — Apple’s recent financial results being a prime example. But it can backfire, too. If a company’s bundle of products doesn’t work together well enough to justify the added cost, customers can get turned off. That’s the danger for Dassault. Joe Barkai, analyst at IDC Manufacturing Insights, says that in this age of consolidation, automakers are more likely to be looking for flexible design systems that can easily share data with a new partner or supplier.

What is my conclusion? I think, we are going to see more and more stories related to development of Open startegies. There are clearly two possible options: 1/To create excellent integrated product suites and sell them to customers (i.e. Apple story) or 2/To develop open strategies. My take – I think Open game is hard. However, the prize can be big. Just my thoughts…

Best, Oleg

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13 Responses to Open vs. Closed PLM Debates

  1. Hi Oleg,

    Don’t know if i already said that in a previous comment, but I’m convinced that if Google puts a team on PLM, they could really fastly come with a powerfull and open solution. Combining google APIs, App Engine, Android, AJAX apis… (http://code.google.com/intl/en/)

    Just an idea of a potential new competitor.

    Yoann

  2. Yoann, Yes, I remember, you said it already about Google. To predict a future is hard. Google is going more towards enterprise apps. I hope you had chance to see my post about Google App Store (http://plmtwine.com/2010/03/09/will-google-app-store-disrupt-plm/). I’m not sure if Google will develop app called PLM. Nevertheless, I can see an opportunity to have applications competing in the space where PLM lives today. Today, I can see Salesforce.com as a more viable potential competitor in this space. Best, Oleg.

  3. jazzi says:

    Interesting!
    Who is right? for one fact, two opposite opinions:
    1, it is a closed stragegy! — objector
    2, it is a good intergration! — supporter

    What I can give the comments for it?
    1, Software Vendor can never deliver the “Openess” as customer expection/imagination;
    2, Software Vendor can never deliver the “Good Integration” as customer expection/imagination;
    3, Don’t try to bind your customer in non-smart way.

  4. Jazzi, I agree. You can see this situation from different perspectives. Please take a look on my comments below:

    1, Software Vendor can never deliver the “Openess” as customer expection/imagination;
    –> This is discussable. I see it as possible, as soon as openness will not be used for competition and customer lock-in.
    2, Software Vendor can never deliver the “Good Integration” as customer expection/imagination;
    –> agree. Integration is hard and not dependent on a single vendor. This is a place where “services” are making most of their money.
    3, Don’t try to bind your customer in non-smart way.
    –> agree. Customer is actually very smart.

    Best, Oleg

  5. [...] Thoughts About PLM Openness My post Open vs. Closed PLM Debates last week and related Fortune CNN Money Blog article by Jon Fortt – Chrysler’s Engineering [...]

  6. [...] Open vs. Closed PLM Debates [...]

  7. [...] document.getElementById("fb-root").appendChild(e); }()); My post Open vs. Closed PLM Debates last week and related Fortune CNN Money Blog article by Jon Fortt – Chrysler’s Engineering [...]

  8. [...] Open vs. Closed PLM Debates [...]

  9. […] (but not only) software ecosystem. Open vs. Close. I’ve been discussing it many times – Open vs. Closed PLM Debates, PLM and New Openness, Closed Thoughts About PLM openness and few more. There is clear trend […]

  10. […] (but not only) software ecosystem. Open vs. Close. I’ve been discussing it many times – Open vs. Closed PLM Debates, PLM and New Openness, Closed Thoughts About PLM openness and few more. There is clear trend […]

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